Senate debates

Monday, 26 March 2018

Questions without Notice

Taxation

2:00 pm

Photo of Jenny McAllisterJenny McAllister (NSW, Australian Labor Party) Share this | | Hansard source

My question is to the Minister for Finance, Senator Cormann. Can the minister confirm that, under the Turnbull government's $65 billion tax cut for big business, the big four banks can expect to save $9.5 billion? If not, how much can the big four expect to walk away with?

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

What I can confirm is that the government proposed and the parliament passed the major bank levy, which was, of course, introduced by the government after the 2017-18 budget. What I can also confirm is that, if the Senate does not take steps to ensure that all Australian businesses are in the best possible position to be successful and profitable into the future, it will harm our economy. If we continue to put our businesses at a competitive disadvantage—and, may I say, in particular the bigger business across Australia—it will cost investment and jobs. That's what will happen. I know that the Labor Party likes to bash the banks, but the truth is that the banks are a central part of our economy, and strong and profitable banks—

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

Order, Senator Cormann. Senator McAllister, on a point of order?

Photo of Jenny McAllisterJenny McAllister (NSW, Australian Labor Party) Share this | | Hansard source

Mr President, my point of order is on relevance. I asked a specific question about how much the banks would expect to save.

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

I note that the minister was addressing the issue of banks then and I note that he has a minute remaining to answer the question. Senator Cormann.

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

Thank you very much, Mr President. The truth is that the government believes that it's in our interest to have one uniform corporate tax rate across all businesses, as has been the case under previous Labor administrations. The Labor Party never used to oppose a higher—

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

Order, Senator Cormann. Senator Wong on a point of order.

Photo of Penny WongPenny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | | Hansard source

Thank you, Mr President. We have given the minister some time. We have asked an important question. We'd like a directly relevant answer. The question goes to the value of the benefit of the company tax cut, the government's company tax cut, to the banks. We've suggested it's $9.5 billion. If it's not that, what is it?

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

Thank you, Senator Wong. Senator Cormann has 49 seconds remaining to turn to that question.

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

Thank you very much, Mr President. I refer the Labor opposition to the analysis which was released by a number of economic and budget fiscal analysts after the last budget which showed our major bank levy and our corporate tax cuts combined effectively cancel themselves out as far as the banks are concerned. For example, the analysis by Civic that was released at the time—

Photo of Doug CameronDoug Cameron (NSW, Australian Labor Party, Shadow Minister for Human Services) Share this | | Hansard source

How about answering the question?

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

The Labor Party used to support business tax cuts. As recently as September 2015—

Senator Wong interjecting

No. That's actually not right. That is not right. I heard that contribution. I heard that contribution by Senator Wong earlier. The shadow treasurer, Chris Bowen, on 22 September 2015 was quoted as saying that he understands that a higher company tax rate hurts the workers— (Time expired)

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

Senator McAllister, a supplementary question.

2:03 pm

Photo of Jenny McAllisterJenny McAllister (NSW, Australian Labor Party) Share this | | Hansard source

Last week, the minister said that the bank levy 'cancels out the effect of the corporate tax cut for the banks already', and the minister has confirmed this again in his answer to my principal question. Analysis conducted by the Australia Institute has found that, even with the bank levy, the Turnbull government's $65 billion tax cut will see banks substantially better off. Who is correct: the minister or the Australia Institute?

2:04 pm

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

Let me tell you: I would recommend to the Senate to take my word ahead of that of the Australia Institute. The Australia Institute is hardly a disinterested party.

Photo of Penny WongPenny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | | Hansard source

Neither are you!

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

Indeed. The Australia Institute is made up of former or aspiring Greens politicians. Clearly the Australia Institute has always had a biased view against business. Greens across Australia in general don't understand that, in order for families to have the best possible opportunity to get ahead, the businesses that employ those families actually need to have an opportunity to be successful and profitable into the future. Now, the Australia Institute is a campaigner on this matter. They are activists on this matter, and I would not take their word for it.

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

Senator McAllister, a supplementary question.

2:05 pm

Photo of Jenny McAllisterJenny McAllister (NSW, Australian Labor Party) Share this | | Hansard source

Will the minister guarantee that, when taking into account the effect of the bank levy, the big four banks will not be better off as a result of the Turnbull government's $65 billion tax cut for big business?

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

The senator asked me for a guarantee. I'll tell you what I can guarantee. What I can guarantee is that if we pass those business tax cuts in full the people who will be better off are Australian working families. What I can also guarantee is that if we don't pass them the people who will be worse off are Australia's working families.

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

Senator Wong on a point of order.

Photo of Penny WongPenny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | | Hansard source

Direct relevance: the minister was asked to guarantee one thing, and that is whether the banks will be better off under his policy or not. I understand that he's avoiding the question, but that was the question.

Photo of Scott RyanScott Ryan (President) Share this | | Hansard source

You've reminded Senator Cormann of the question, Senator Wong. Senator Cormann is being directly relevant to the question as it was put.

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | | Hansard source

What I can guarantee you is that if we continue to put Australia's big businesses at a competitive disadvantage it will cost investment and it will cost jobs. Senator Wong seems to think that the banks are something abstract out there that don't have any relevance to our economy. The truth is that stronger and more profitable banks are important for small and medium-size businesses operating in our economy. It's important for shareholders. It's important for self-funded retirees. Every self-funded retiree will have a large chunk of their retirement savings invested in banks, because they provide a reliable income stream for self-funded retirees—something that Labor doesn't understand. (Time expired)